Verizon Consolidates $1.9 Billion Marketing Business

McCann WorldGroup Is Big Winner

NEW YORK (AdAge.com) -- Verizon Communications today said it is consolidating its $1.9 billion advertising and media accounts for its corporate and business-to-business units with that of Verizon Wireless, and assigning all to a handful of agencies. This is the first time the two telecommunications divisions have completely merged their agency functions.
The move by Verizon will lead to a unified feel for its marketing for both Verizon Wireless and Verizon's other business units.
The move is an effort to create a common look and feel across the company's lines of business, as well as provide cost savings. It whittles down a roster of more than 20 creative and media-buying agencies to 10. All of the 10 selected agencies were previously on either Verizon Communication's or Verizon Wireless' roster, said a company spokeswoman.

McCann Worldgroup
The overall winner in the review is Interpublic Group of Cos.' McCann Worldgroup. McCann Erickson has been the creative agency for wireless and will now be responsible for combined creative duties. Universal McCann, which had handled planning and buying for wireless, will now handle duties for all national media planning. MRM will handle direct marketing, while Momentum takes on sponsorships. R/GA, which had worked for Verizon Communications, now takes on digital design duties for both wireless and corporate.

TNS Media Intelligence reported Verizon's combined spending across all its entities in 2006 at $1.9 billion, with $327 million of that devoted to Verizon Communications.

The losers in the reorganization are Interpublic's DraftFCB, which was a longtime agency for Verizon Communications, and independent McGarrybowen, which worked for Verizon Communications since 2002. Burrell had handled African-American advertising, and Orci had Hispanic.

Other agencies on roster
With Universal McCann now responsible for national planning duties, Publicis Groupe's Zenith will handle national media buying for corporate and wireless. The agency retains local and regional media planning and buying. Other incumbents remaining on the roster are Global Hue and Ad Asia for multicultural; Publicis' Moxie for online creative planning and buying; WPP Group's Landor Associates, which will handle brand identity and naming.

"The Verizon brand resonates with customers as one strong tradition in providing quality communications products and services," John Stratton, exec VP-chief marketing officer at Verizon said in a release. "Fewer agencies will allow us to leverage key creative teams and develop one immediately identifiable Verizon brand."

AT&T, for example, has said that 20% of its savings from its acquisition of BellSouth and its total ownership of Cingular Wireless, now AT&T's mobility unit, would come from advertising and marketing savings. In the past, Verizon has said that it needed to keep the wireless and l;andline companies separate due to the minority ownership by Vodafone.